Owning a flat usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. This lease will usually be granted for a prescribed period of time , ordinarily 99 or 125 years, although we have come across longer and shorter terms in Roundhay. Clearly, the period of lease remaining shortens as time goes by. This may pass by relatively unnoticed when the residence has to be sold or refinanced. The fewer the years remaining the less it is worth and the more expensive it will be to obtain a lease extension. Qualifying leaseholders in Roundhay have the legal entitlement to extend the lease for a further ninety years under the 1993 Leasehold Reform Act. You should give due attention before putting off your Roundhay lease extension. Putting off that expense now only increases the price you will eventually incur for a lease extension
Leasehold properties in Roundhay with in excess of 100 years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such circumstances there is often little to be gained by buying the freehold unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Chelsea Building Society | 85 years from the date of completion of the mortgage. Please ensure that you explain the implications of a short term lease to the borrower. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The lawyers that we work with undertake Roundhay lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The lawyer we work with provide it.
Milo owned a conversion flat in Roundhay on the market with a lease of fraction over fifty eight years unexpired. Milo informally spoke with his landlord a well known Bristol-based freehold company for a lease extension. The landlord indicated a willingness to grant an extension taking the lease to 125 years on the basis of a new rent initially set at £200 per annum and increase every 25 years thereafter. No ground rent would be payable on a lease extension were Milo to exercise his statutory right. Milo procured expert legal guidance and secured an acceptable deal without resorting to tribunal and sell the flat.
Dr Sophia Sánchez moved into a one bedroom apartment in Roundhay in August 2009. We are asked if we could estimate the compensation to the landlord would likely be to prolong the lease by 90 years. Similar homes in Roundhay with 100 year plus lease were in the region of £275,000. The mid-range ground rent payable was £45 invoiced monthly. The lease ended in 2095. Considering the 69 years unexpired we calculated the compensation to the freeholder for the lease extension to be between £12,400 and £14,200 plus costs.
Last Summer we were contacted by Mrs F White , who owned a one bedroom flat in Roundhay in November 2003. The question was if we could shed any light on how much (approximately) premium would likely be to prolong the lease by ninety years. Identical flats in Roundhay with 100 year plus lease were valued around £216,000. The mid-range amount of ground rent was £60 billed monthly. The lease expired in 2084. Considering the 58 years outstanding we approximated the premium to the freeholder for the lease extension to be between £28,500 and £33,000 exclusive of professional charges.